sightly and foul-smelling estuary water may re- duce the enjoyment of potential recreational users
of an estuary. This typical externality problem around water
use is described in Fig. 2. Mariculturalists face upward-sloping private marginal cost curves as
fuel and other costs rise with increasing water exchange. The private benefits from using water
exchange are initially high but then decrease. This leads to an initial equilibrium where costs equal
benefits and a farm chooses to exchange water at a rate X say 10, resulting in a given quantity of
effluent loads and marginal damages to other water users. The optimal water exchange rate for
society would be at the lower point Y where total private and social costs cross the benefit curve.
But considerable debate exists as to the nature of these externalities. Some shrimp farmers argue
that their contribution to water quality is a posi- tive externality if waters flushed out of shrimp
ponds are cleaner than up-stream source estuary waters Acuacultura de Ecuador, 1997. To date,
there are few studies to support this claim; how- ever, Teichert-Coddington 1995 reports mean
concentrations of inorganic phosphorus and ni- trogen are higher upstream in riverine estuaries of
southern Honduras than in gulf embayments be- low the shrimp farms. Other literature suggests
aquaculture as an industry tends to produce a higher volume, but lower concentration, of
effluents than other activities Beveridge et al., 1991. Mariculturalists also argue they are victims
of adverse externalities from other users of a waterway.
Thus the mariculture wastewater debate repre- sents a non-point source pollution problem with
moral hazard characteristics. Monitoring each farm’s water canal is infeasible. Weather uncer-
tainties and other stochastic variables outside a farmer’s control complicate the matter. This cre-
ates an imperfect information scenario in which the management effort of an individual farm can-
not be perfectly correlated with pollutant concen- trations
or other
observed water
quality indicators. And while pollution damage varies
over time and distance, the dispersal path of shrimp farm waste has not been fully investigated.
Additionally, confusion still exists as to the criti- cal levels of waste from individual farms or
whether farms as a group threaten ecosystem recovery by damaging ambient levels beyond a
safe minimum standard. The pollution issue ulti- mately turns on the number and size of farms in
an estuary, the carrying capacity of the watershed, and whether receiving waters can dilute wastes.
Griffin and Bromley 1982 suggest construct- ing a ‘‘pollution production function’’ relating
inputs and management practices to the genera- tion of such non-point source pollution. The
aquaculture literature suggests a chain of cau- sation between water quality damage and exces-
sive feed rates, feeds with high nitrogen content, antibiotics and fertilizers, and high water ex-
change rates. These inputs have been targeted in the industry discussion of the voluntary adoption
best management practices as a non-regulatory solution to the water pollution problem.
3. The voluntary adoption of best management practices
Best management practices BMPs are a logi- cal short-run alternative given the informational
Fig. 2. Thick line represents private marginal costs water exchange or benefits of reduced exchange. Medium thick line
represents total cost of water exchange private and social costs. Thin line represents benefits reduced exchange incorpo-
rating medium-term benefits. Broken thick line represents pri- vate marginal benefits of water exchange or costs of reduced
exchange. Thin broken line represents costs of reduced ex- change incorporating smaller productivity losses.
problems around non-point source water pollu- tion. An innovative aspect of many BMPs is their
focus on pollution prevention by reducing the quantity of inputs that cause run-off and emis-
sions. This, of course, parallels similar develop- ments
in the
industrial ecology
and green
manufacturing literature around profit enhance- ment and pollution reduction through preventing
waste or developing by-products that use waste products Hawken, 1993. Such cost-saving strate-
gies should be profitable or profit neutral to busi- nesses.
The following
six best
management practices could reduce mariculture water effluents
while maintaining farm profitability Hopkins et al., 1995; Dierberg and Kiattisimkul, 1996:
On-farm intake or effluent treatment plants settling basins or constructed wetlands
Sludge removal
Co-production schemes
Improved feed and fertilizer management
Lower stocking rates
Reduced water exchange or even closed recycling systems.
The first three options are ‘structural BMPs’, which require fixed investments and significant
capital outlay Lichtenberg et al., 1993. For in- stance, although settling basins remove significant
amounts of suspended solids, BOD and phospho- rus, this form of effluent treatment is problematic
since it may require taking land out of production Pillay, 1992, cited in Goldburg and Triplett, 1997.
The last three are ‘managerial BMPs’ requiring changes in variable input use. Better feed manage-
ment lowers costs while reducing pollution. Feeding trays are a small investment likely to lower feed
conversion ratios.
3
The analysis here focuses on the less-known option of reduced water exchange since it involves
no fixed costs and gives immediate reductions in pumping operating costs. Reduced water exchange
could involve lowering the daily rate, reusing water in a nearby pond, or complete recycling and elimin-
ation of exchange. Lower exchange reduces effluent quantities by decreasing the amount of water
flushed from a pond. And reduced water exchange enhances in-pond digestive processes and shrimp
growth rates under well-managed feeding systems Leber and Pruder, 1988; Browdy et al., 1997.
Experiments at the Waddell Mariculture Center in South Carolina suggest water exchange of inten-
sive shrimp farming can be reduced or nearly eliminated without sacrificing growth or survival
as long as dawn dissolved oxygen levels are main- tained Browdy et al., 1993; Hopkins et al., 1993.
Developing country farms stocking at lower densi- ties without supplemental aeration represents a
more challenging experimental setting. Lin 1995 and Dierberg and Kiattisimkul 1996 provide
examples of successful reduced exchange in Asia with or without the use of supplementary aeration.
A recent experiment in Ecuador reducing water exchange from 10 daily in a control pond to
approximately 2.5 daily in neighboring ponds demonstrated no significant differences in survival
and growth across ponds Calderon et al., 1998. However, Martinez-Cordova et al. 1995 find high
10 – 15 daily water exchange rates are necessary for shrimp growth, survival and yields in the saline
environment of western Mexico.
Reduced exchange is still not widely practiced among the thousands of shrimp farm operators in
Asia and Latin America. Exchange rates of 5 – 25 daily in semi-intensive farming, and 30 daily for
intensive operations, remain the norm Rosenberry, 1997. Many farmers still do not perceive the
private financial benefits of water amendments implemented on a commercial scale Stern, 1995.
The next section explores the logic of farmers’ decisions and problems associated with this techni-
cal solution to water pollution.
4. The adoption dilemma around BMPs
